Cirrus Logic Reports Fiscal Third Quarter Revenue of $555.7 Million

Rhea-AI Summary

Cirrus Logic (NASDAQ: CRUS) reported strong fiscal Q3 2025 results with revenue of $555.7 million, significantly exceeding guidance. The company achieved GAAP and non-GAAP gross margin of 53.6%, with GAAP EPS of $2.11 and non-GAAP EPS of $2.51.

Performance was driven by higher-than-expected smartphone shipments, particularly strong demand for smartphone audio components, including their latest-generation custom boosted amplifier and first 22-nanometer smart codec. The company also gained momentum in their laptop business through inclusion in Intel Arrow Lake reference design.

For Q4 FY25, Cirrus Logic projects revenue between $350 million and $410 million, with GAAP gross margin forecasted between 51-53%. Combined GAAP R&D and SG&A expenses are expected to range from $141 million to $147 million.

Positive

• Revenue of $555.7M exceeded guidance expectations
• Strong 53.6% gross margin in Q3 FY25
• Solid EPS performance with GAAP $2.11 and non-GAAP $2.51
• Expanded presence in laptop market through Intel Arrow Lake partnership

Negative

• Projected Q4 FY25 revenue ($350M-$410M) represents sequential decline from Q3
• Expected Q4 gross margin decline to 51-53% from 53.6% in Q3

Insights

Financial Analyst

The Q3 FY25 results demonstrate Cirrus Logic's exceptional execution and market leadership in audio solutions. The $555.7 million revenue showcases robust demand, particularly noteworthy given the typically challenging December quarter for semiconductor companies. The 53.6% gross margin reflects strong pricing power and operational efficiency, significantly above the semiconductor industry average of around 45%.

The strategic expansion into laptops through the Intel Arrow Lake reference design partnership represents a important diversification effort. This move could potentially unlock a $1+ billion addressable market opportunity, reducing the company's historical dependence on smartphone customers. The 22nm smart codec technology signals a significant competitive advantage, as most competitors are still operating at 28nm, enabling better power efficiency and performance metrics.

The Q4 guidance, while showing seasonal decline, maintains healthy margins between 51-53%, indicating strong cost management despite volume fluctuations. The controlled operating expenses, with non-GAAP opex of $119-125 million, demonstrate disciplined investment in R&D while maintaining profitability.

Two key strategic developments warrant attention:

• The laptop segment expansion through Intel partnership positions Cirrus for significant growth in the high-performance computing audio market
• The 22nm process technology deployment showcases the company's commitment to maintaining its technological edge in the premium audio solutions space

AUSTIN, Texas--(BUSINESS WIRE)-- Cirrus Logic, Inc. (NASDAQ: CRUS) today posted on its website at investor.cirrus.com the quarterly Shareholder Letter that contains the complete financial results for the third quarter of fiscal year 2025, which ended December 28, 2024, as well as the company’s current business outlook.

“Cirrus Logic delivered revenue significantly above the top end of our guidance range in the December quarter as shipments into smartphones exceeded our expectations,” said John Forsyth, Cirrus Logic president and chief executive officer. “During the quarter, we experienced strong demand for our smartphone audio components, including our latest-generation custom boosted amplifier and first 22-nanometer smart codec. Additionally, we gained momentum in our laptop business as we were featured as part of the Intel Arrow Lake reference design, began sampling our latest amplifier and codec specifically designed for laptops, and expanded our breadth of content across a variety of devices. With a compelling roadmap of products and a proven track record of execution, we believe Cirrus Logic is well-positioned to grow long-term shareholder value.”

Reported Financial Results – Third Quarter FY25

• Revenue of $555.7 million;
• GAAP and non-GAAP gross margin of 53.6 percent;
• GAAP operating expenses of $152.0 million and non-GAAP operating expenses of $129.2 million; and
• GAAP earnings per share of $2.11 and non-GAAP earnings per share of $2.51.

A reconciliation of GAAP to non-GAAP financial information is included in the tables accompanying this press release.

Business Outlook – Fourth Quarter FY25

• Revenue is expected to range between $350 million and $410 million;
• GAAP gross margin is forecasted to be between 51 percent and 53 percent; and
• Combined GAAP R&D and SG&A expenses are anticipated to range between $141 million and $147 million, including approximately $20 million in stock-based compensation expense and $2 million in amortization of acquired intangibles, resulting in a non-GAAP operating expense range between $119 million and $125 million.

Cirrus Logic will host a live Q&A session at 5 p.m. EST today to discuss its financial results and business outlook. Participants may listen to the conference call on the investor relations website at investor.cirrus.com. A replay of the webcast can be accessed on the Cirrus Logic website approximately two hours following its completion or by calling (609) 800-9909 or toll-free at (800) 770-2030 (Access Code: 95424).

About Cirrus Logic, Inc.

Cirrus Logic is a leader in low-power, high-precision mixed-signal processing solutions that create innovative user experiences for the world’s top mobile and consumer applications. With headquarters in Austin, Texas, Cirrus Logic is recognized globally for its award-winning corporate culture.

Cirrus Logic, Cirrus and the Cirrus Logic logo are registered trademarks of Cirrus Logic, Inc. All other company or product names noted herein may be trademarks of their respective holders.

Use of non-GAAP Financial Information

To supplement Cirrus Logic's financial statements presented on a GAAP basis, the company has provided non-GAAP financial information, including non-GAAP net income, diluted earnings per share, operating income and profit, operating expenses, gross margin and profit, tax expense, tax expense impact on earnings per share, effective tax rate, free cash flow, and free cash flow margin. A reconciliation of the adjustments to GAAP results is included in the tables below. Non-GAAP financial information is not meant as a substitute for GAAP results but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. The non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP.

Safe Harbor Statement

Except for historical information contained herein, the matters set forth in this news release contain forward-looking statements including our statement about our belief that we are well-positioned to grow long-term shareholder value; and our estimates for the fourth quarter fiscal year 2025 revenue, gross margin, combined research and development and selling, general and administrative expense levels, stock-based compensation expense, and amortization of acquired intangibles. In some cases, forward-looking statements are identified by words such as “expect,” “anticipate,” “target,” “project,” “believe,” “goals,” “opportunity,” “estimates,” “intend,” and variations of these types of words and similar expressions. In addition, any statements that refer to our plans, expectations, strategies, or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements are based on our current expectations, estimates, and assumptions and are subject to certain risks and uncertainties that could cause actual results to differ materially, and readers should not place undue reliance on such statements. These risks and uncertainties include, but are not limited to, the following: the level and timing of orders and shipments during the fourth quarter of fiscal year 2025, customer cancellations of orders, or the failure to place orders consistent with forecasts, along with the risk factors listed in our Form 10-K for the year ended March 30, 2024 and in our other filings with the Securities and Exchange Commission, which are available at www.sec.gov. The foregoing information concerning our business outlook represents our outlook as of the date of this news release, and we expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.

Summary Financial Data Follows:

CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(in thousands, except per share data; unaudited)
	Three Months Ended												Nine Months Ended
	Dec. 28,				Sep. 28,				Dec. 30,				Dec. 28,				Dec. 30,
		2024				2024				2023				2024				2023
	Q3'25				Q2'25				Q3'24				Q3'25				Q3'24
Audio	$	346,272			$	316,588			$	378,597			$	881,830			$	857,258
High-Performance Mixed-Signal		209,466				225,269				240,387				589,791				559,805
Net sales		555,738				541,857				618,984				1,471,621				1,417,063
Cost of sales		257,951				259,267				301,520				702,319				693,616
Gross profit		297,787				282,590				317,464				769,302				723,447
Gross margin		53.6	%			52.2	%			51.3	%			52.3	%			51.1	%
Research and development		112,976				112,925				112,672				331,264				323,092
Selling, general and administrative		39,042				37,813				37,604				113,625				107,306
Restructuring costs		—				—				(360	)			—				1,959
Total operating expenses		152,018				150,738				149,916				444,889				432,357
Income from operations		145,769				131,852				167,548				324,413				291,090
Interest income		8,146				8,134				4,889				24,482				13,218
Other income (expense)		(214	)			19				(337	)			1,414				(30	)
Income before income taxes		153,701				140,005				172,100				350,309				304,278
Provision for income taxes		37,696				37,865				33,377				90,069				74,548
Net income	$	116,005			$	102,140			$	138,723			$	260,240			$	229,730
Basic earnings per share	$	2.19			$	1.92			$	2.57			$	4.89			$	4.22
Diluted earnings per share:	$	2.11			$	1.83			$	2.50			$	4.69			$	4.09
Weighted average number of shares:
Basic		53,081				53,275				54,016				53,263				54,449
Diluted		55,076				55,800				55,592				55,529				56,160
Prepared in accordance with Generally Accepted Accounting Principles

RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in thousands, except per share data; unaudited)
(not prepared in accordance with GAAP)
Non-GAAP financial information is not meant as a substitute for GAAP results, but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. As a note, the non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP.
	Three Months Ended												Nine Months Ended
	Dec. 28,				Sep. 28,				Dec. 30,				Dec. 28,				Dec. 30,
		2024				2024				2023				2024				2023
Net Income Reconciliation	Q3'25				Q2'25				Q3'24				Q3'25				Q3'24
GAAP Net Income	$	116,005			$	102,140			$	138,723			$	260,240			$	229,730
Amortization of acquisition intangibles		1,647				1,864				1,972				5,483				6,312
Stock-based compensation expense		20,823				22,447				23,067				64,655				67,113
Lease impairment		661				—				—				1,680				—
Restructuring costs		—				—				(360	)			—				1,959
Acquisition-related costs		—				—				—				—				4,105
Adjustment to income taxes		(827	)			(1,162	)			(2,769	)			(6,094	)			(9,001	)
Non-GAAP Net Income	$	138,309			$	125,289			$	160,633			$	325,964			$	300,218
Earnings Per Share Reconciliation
GAAP Diluted earnings per share	$	2.11			$	1.83			$	2.50			$	4.69			$	4.09
Effect of Amortization of acquisition intangibles		0.03				0.04				0.04				0.10				0.11
Effect of Stock-based compensation expense		0.38				0.40				0.41				1.16				1.20
Effect of Lease impairment		0.01				—				—				0.03				—
Effect of Restructuring costs		—				—				(0.01	)			—				0.04
Effect of Acquisition-related costs		—				—				—				—				0.07
Effect of Adjustment to income taxes		(0.02	)			(0.02	)			(0.05	)			(0.11	)			(0.16	)
Non-GAAP Diluted earnings per share	$	2.51			$	2.25			$	2.89			$	5.87			$	5.35
Operating Income Reconciliation
GAAP Operating Income	$	145,769			$	131,852			$	167,548			$	324,413			$	291,090
GAAP Operating Profit		26.2	%			24.3	%			27.1	%			22.0	%			20.5	%
Amortization of acquisition intangibles		1,647				1,864				1,972				5,483				6,312
Stock-based compensation expense - COGS		351				355				395				972				1,041
Stock-based compensation expense - R&D		14,498				15,844				16,771				46,105				48,195
Stock-based compensation expense - SG&A		5,974				6,248				5,901				17,578				17,877
Lease impairment		661				—				—				1,680				—
Restructuring costs		—				—				(360	)			—				1,959
Acquisition-related costs		—				—				—				—				4,105
Non-GAAP Operating Income	$	168,900			$	156,163			$	192,227			$	396,231			$	370,579
Non-GAAP Operating Profit		30.4	%			28.8	%			31.1	%			26.9	%			26.2	%
Operating Expense Reconciliation
GAAP Operating Expenses	$	152,018			$	150,738			$	149,916			$	444,889			$	432,357
Amortization of acquisition intangibles		(1,647	)			(1,864	)			(1,972	)			(5,483	)			(6,312	)
Stock-based compensation expense - R&D		(14,498	)			(15,844	)			(16,771	)			(46,105	)			(48,195	)
Stock-based compensation expense - SG&A		(5,974	)			(6,248	)			(5,901	)			(17,578	)			(17,877	)
Lease impairment		661				—				—				1,680				—
Restructuring costs		—				—				360				—				(1,959	)
Acquisition-related costs		—				—				—				—				(4,105	)
Non-GAAP Operating Expenses	$	129,238			$	126,782			$	125,632			$	374,043			$	353,909
Gross Margin/Profit Reconciliation
GAAP Gross Profit	$	297,787			$	282,590			$	317,464			$	769,302			$	723,447
GAAP Gross Margin		53.6	%			52.2	%			51.3	%			52.3	%			51.1	%
Stock-based compensation expense - COGS		351				355				395				972				1,041
Non-GAAP Gross Profit	$	298,138			$	282,945			$	317,859			$	770,274			$	724,488
Non-GAAP Gross Margin		53.6	%			52.2	%			51.4	%			52.3	%			51.1	%
	Three Months Ended												Nine Months Ended
	Dec. 28,				Sep. 28,				Dec. 30,				Dec. 28,				Dec. 30,
		2024				2024				2023				2024				2023
Effective Tax Rate Reconciliation	Q3'25				Q2'25				Q3'24				Q3'25				Q3'24
GAAP Tax Expense	$	37,696			$	37,865			$	33,377			$	90,069			$	74,548
GAAP Effective Tax Rate		24.5	%			27.0	%			19.4	%			25.7	%			24.5	%
Adjustments to income taxes		827				1,162				2,769				6,094				9,001
Non-GAAP Tax Expense	$	38,523			$	39,027			$	36,146			$	96,163			$	83,549
Non-GAAP Effective Tax Rate		21.8	%			23.8	%			18.4	%			22.8	%			21.8	%
Tax Impact to EPS Reconciliation
GAAP Tax Expense	$	0.68			$	0.68			$	0.60			$	1.62			$	1.33
Adjustments to income taxes		0.02				0.02				0.05				0.11				0.16
Non-GAAP Tax Expense	$	0.70			$	0.70			$	0.65			$	1.73			$	1.49

CONSOLIDATED CONDENSED BALANCE SHEET
(in thousands; unaudited)
		Dec. 28,				Mar. 30,				Dec. 30,
			2024				2024				2023
ASSETS
Current assets
Cash and cash equivalents		$	526,444			$	502,764			$	483,931
Marketable securities			37,535				23,778				32,842
Accounts receivable, net			261,943				162,478				217,269
Inventories			275,558				227,248				256,675
Prepaid wafers			66,113				86,679				84,854
Other current assets			82,857				103,245				109,814
Total current Assets			1,250,450				1,106,192				1,185,385
Long-term marketable securities			252,594				173,374				70,260
Right-of-use lease assets			129,597				138,288				140,993
Property and equipment, net			163,837				170,175				167,579
Intangibles, net			23,957				29,578				31,677
Goodwill			435,936				435,936				435,936
Deferred tax asset			40,895				48,649				34,116
Long-term prepaid wafers			23,020				60,750				73,492
Other assets			42,954				68,634				77,675
Total assets		$	2,363,240			$	2,231,576			$	2,217,113
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable		$	77,907			$	55,545			$	56,231
Accrued salaries and benefits			48,029				47,612				44,352
Lease liability			21,858				20,640				19,906
Other accrued liabilities			63,119				62,596				58,105
Total current liabilities			210,913				186,393				178,594
Non-current lease liability			124,622				134,576				138,415
Non-current income taxes			43,401				52,013				52,247
Other long-term liabilities			21,506				41,580				47,097
Total long-term liabilities			189,529				228,169				237,759
Stockholders' equity:
Capital stock			1,840,791				1,760,701				1,735,824
Accumulated earnings			124,101				58,916				66,633
Accumulated other comprehensive loss			(2,094	)			(2,603	)			(1,697	)
Total stockholders' equity			1,962,798				1,817,014				1,800,760
Total liabilities and stockholders' equity		$	2,363,240			$	2,231,576			$	2,217,113
Prepared in accordance with Generally Accepted Accounting Principles

CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(in thousands; unaudited)
		Three Months Ended
		Dec. 28,				Dec. 30,
			2024				2023
		Q3'25				Q3'24
Cash flows from operating activities:
Net income		$	116,005			$	138,723
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			12,824				12,732
Stock-based compensation expense			20,823				23,067
Deferred income taxes			8,379				9,723
Loss on retirement or write-off of long-lived assets			369				10
Other non-cash charges			(379	)			668
Restructuring costs			—				(360	)
Net change in operating assets and liabilities:
Accounts receivable, net			62,155				54,048
Inventories			(3,793	)			72,257
Prepaid wafers			20,411				15,596
Other assets			1,720				17,973
Accounts payable and other accrued liabilities			(21,556	)			(32,123	)
Income taxes payable			1,630				1,378
Net cash provided by operating activities			218,588				313,692
Cash flows from investing activities:
Maturities and sales of available-for-sale marketable securities			12,423				5,176
Purchases of available-for-sale marketable securities			(44,868	)			(32,334	)
Purchases of property, equipment and software			(6,687	)			(9,813	)
Net cash used in investing activities			(39,132	)			(36,971	)
Cash flows from financing activities:
Net proceeds from the issuance of common stock			378				50
Repurchase of stock to satisfy employee tax withholding obligations			(29,112	)			(13,722	)
Repurchase and retirement of common stock			(70,037	)			(56,923	)
Net cash used in financing activities			(98,771	)			(70,595	)
Net increase in cash and cash equivalents			80,685				206,126
Cash and cash equivalents at beginning of period			445,759				277,805
Cash and cash equivalents at end of period		$	526,444			$	483,931
Prepared in accordance with Generally Accepted Accounting Principles

RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in thousands; unaudited)
Free cash flow, a non-GAAP financial measure, is GAAP cash flow from operations (or cash provided by operating activities) less capital expenditures. Capital expenditures include purchases of property, equipment and software as well as investments in technology, as presented within our GAAP Consolidated Condensed Statement of Cash Flows. Free cash flow margin represents free cash flow divided by revenue.
		Twelve Months Ended				Three Months Ended
		Dec. 28,				Dec. 28,				Sep. 28,				Jun. 29,				Mar. 30,
			2024				2024				2024				2024				2024
		Q3'25				Q3'25				Q2'25				Q1'25				Q4'24
Net cash provided by operating activities (GAAP)		$	484,506			$	218,588			$	8,231			$	87,161			$	170,526
Capital expenditures			(27,267	)			(6,687	)			(2,740	)			(10,145	)			(7,695	)
Free Cash Flow (Non-GAAP)		$	457,239			$	211,901			$	5,491			$	77,016			$	162,831
Cash Flow from Operations as a Percentage of Revenue (GAAP)			26	%			39	%			2	%			23	%			46	%
Capital Expenditures as a Percentage of Revenue (GAAP)			1	%			1	%			1	%			3	%			2	%
Free Cash Flow Margin (Non-GAAP)			25	%			38	%			1	%			21	%			44	%

RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in millions; unaudited)
(not prepared in accordance with GAAP)
		Q4 FY25
		Guidance
Operating Expense Reconciliation
GAAP Operating Expenses		$141 - 147
Stock-based compensation expense		(20)
Amortization of acquisition intangibles		(2)
Non-GAAP Operating Expenses		$119 - 125

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250204408544/en/

Investor Contact:

Chelsea Heffernan

Vice President, Investor Relations

Cirrus Logic, Inc.

(512) 851-4125

Investor@cirrus.com

 

Source: Cirrus Logic, Inc.

FAQ

What was Cirrus Logic's (CRUS) revenue in Q3 FY25?

Cirrus Logic reported revenue of $555.7 million for the third quarter of fiscal year 2025, ending December 28, 2024.

What is CRUS's revenue guidance for Q4 FY25?

Cirrus Logic expects revenue to range between $350 million and $410 million for the fourth quarter of fiscal year 2025.

What was Cirrus Logic's (CRUS) EPS in Q3 FY25?

Cirrus Logic reported GAAP earnings per share of $2.11 and non-GAAP earnings per share of $2.51 for Q3 FY25.

What drove CRUS's performance in Q3 FY25?

Performance was driven by higher-than-expected smartphone shipments, strong demand for smartphone audio components, including their latest-generation custom boosted amplifier and first 22-nanometer smart codec.

What new market developments did CRUS announce for their laptop business?

Cirrus Logic gained momentum in the laptop business by being featured in the Intel Arrow Lake reference design and began sampling their latest amplifier and codec specifically designed for laptops.